DC Insight: Bringing the Pensions Ombudsman into the 21st Century

Anthony Arter talked to the DC Insight audience about trends his office is seeing since the pension freedoms were introduced last year.

Defined contribution is creeping up the agenda for Pensions Ombudsman Anthony Arter. Just over one in eight complaints last year related to DC savings, up from one in 11 the year before. But what’s driving this increase?

Referring to recent research from Aon, Arter pointed out that only 16% of savers are currently putting away enough for retirement. This, in conjunction with an increase in pensions scams, is ramping up the pressure on schemes and providers, who are subject to increasing numbers of complaints.

70% of complaints are now resolved informally

So what does this mean for the Pensions Ombudsman? There is now a focus on smoothing and simplifying the customer journey: 70% of complaints are now resolved informally, and the average time for dispute settlement has dropped over the past year – saving the pensions industry cost in both time and resources.

The ombudsman is there to help schemes and members through auto-enrolment pensions freedoms legislation effectively by settling any disputes – and that is what Arter intends to do.

The key is proper and effective communication

“The key is proper and effective communication – whether that is in schemes or via the ombudsman,” he pointed out. “Pensions providers could do more to minimise complaints, and communication is vital to this.”

Looking specifically at pensions liberation, Arter cited the record number of new cases – 20% of all investigations in 2015/16 – caused by liberation fraud.

“The public should be allowed to invest as they wish – but they should also be protected,” he explained.

Arter also said that he fully supported the government’s plans to consolidate money and pensions advice services into a single body.

There needs to be clarity of who does what, and how they can help members

“Pensions are complicated enough for members, without having to worry about which service to use. There needs to be clarity of who does what, and how they can help members.”

So, moving into 2017, what will the ombudsman’s main challenge be? It’s not surprising that Arter addressed the issue of when and how Brexit takes place as the key uncertainty for the industry moving forward.

But in an effort to make procedures as simple and streamlined as possible, the ombudsman is focusing on bringing processes firmly into the 21st century: working with the pensions industry closely to ensure a user-friendly, easy access experience for scheme members.